Businesses are increasingly using search engine optimisation techniques to improve their website’s ranking in search engine results. But what kind of SEO contract should your business have and what are your rights if the SEO agency doesn’t achieve the results expected?

What is an SEO contract?

Search engine optimisation describes the use of targeted keywords and content to increase a website’s ranking in search engine results.

Optimisation techniques are now widely used in business marketing strategies and many companies utilise SEO keywords to ensure that their websites are displayed towards the top in search results.

As SEO measures are often technical and complex, many businesses purchase SEO services from specialised SEO agencies.

There are many ways in which a website can be optimised and consequently a contract with an SEO agency (SEO contract) can include many different services, such as:

SEO Advice

Competition analysis

Link building

Setting specific backlinks

On-page optimisation

Content development

An undertaking to achieve a particular search ranking

Due to the plethora of SEO services available, it is not possible to make a general assumption as to the classification of an SEO contract. An SEO lawyer will always need to analyse an SEO contract before being able to give legal advice as to its consequences.

The question of whether an SEO contract is one for the provision of services or for the sale of works is important as the type of contract can affect the obligations an SEO agency has to achieve a result. It can also affect the rights of the recipient business if it all goes wrong.

SEO: contract for services or for works?

The German Civil Code differentiates between contracts for the supply of services (Dienstvertrag, § 611 BGB) and contracts for the completion of works (Werkvertrag, § 631 BGB).

Supply of services

Under a contract for the supply of services a party to the contract undertakes to perform a service. Generally that party is under no obligation to achieve a result. This means that SEO agencies performing services under such a contract are only obliged to use reasonable endeavours to bring about a result. They are not obliged to achieve a result, but simply to try to achieve it.

Completion of works

Under a contract for the completion of works a party undertakes to perform work or a service and achieve a specified result. This means an SEO agency would be under an obligation to actually bring about an agreed result.

This element is central to the contract and is generally the measurement used to gauge proper performance of the requisite duties.

If the result is not achieved, the client has wide-ranging statutory rights concerning performance. However, under such contracts, SEO agencies are supposed to be given a second chance to achieve the desired result and therefore need not worry about a client terminating the SEO contract at this point.

SEO services are accompanied by many risks: search engines are constantly developing and algorithms are constantly changing; links are deleted by webmasters and important link partners drop away. For this reason SEO agencies tend to be reluctant to guarantee specific results and are more interested in entering into contracts for the supply of services.

SEO contract

If an SEO contract includes obligations on the SEO agency to develop content or to ensure a particular number or certain quality of links are created, the contract will be a works contract. This is because the SEO agency is under an obligation to achieve a particular result.

If an SEO agency does not promise to achieve a particular search ranking, the contract would be one for the provision of service and the client has no rights to sue if a certain result is not achieved.

The current case law

These principles can be demonstrated by a case heard by the Regional Court of Amberg. The case concerned an SEO contract in which the SEO Agency had agreed to create 684 backlinks within three months at a cost of almost €180 per month. The judges rightly concluded that such a contract was a works contract.

It is important to note that the court’s decision was case specific. The underlying contractual principles will apply to a contract of this type, but not to all SEO contracts. Each SEO contract must be assessed on its own merits in order to ascertain its true legal form.

Contractual considerations

To avoid disputes with an SEO agency, it is highly advisable to regulate the contractual relationship in a comprehensive written agreement. The SEO agreement should clearly and precisely detail the desired services.

The term “result” or achievement should be used with caution. The agreement should clearly regulate whether the services being performed are designed to generally improve a website or whether the achievement of a specific result is expected.

Remember that simply labelling an SEO agreement as a contract for works or a contract for the supply of services is legally worthless. The courts will always consider the content of the contract.

If you would like assistance in drafting an SEO contract or if you are about to enter into an SEO agreement and require advice, our expert team is here to help.